Former HP chief pleads not guilty in spy case

She faces charge of getting phone records illegally

November 16, 2006|By Joel Rosenblatt Bloomberg News

Former Hewlett-Packard Co. Chairman Patricia Dunn pleaded not guilty Wednesday to conspiracy and fraud charges stemming from an investigation of boardroom leaks at the world's largest seller of personal computers.

Dunn, 53, through an attorney, entered the plea in state court in San Jose, Calif. She and four others were charged last month by California Attorney General Bill Lockyer with using illegal tactics to track the phone calls of Hewlett-Packard board members and journalists.

"This case is going to trial," her attorney James Brosnahan said before Wednesday morning's hearing. Another lawyer, Raj Chatterjee, entered the plea on Dunn's behalf before Santa Clara County Superior Court Judge Jerome Nadler.

Dunn authorized the inquiry, in which investigators used assumed identities to obtain private phone records. That technique, known as pretexting, put the Palo Alto, Calif.-based company at the center of a national debate on privacy.

Accompanied by her husband, Bill Jahnke, Dunn spoke little during the hearing Wednesday. She left the courthouse without talking to reporters.

Dunn, who was dismissed from Hewlett-Packard in September, is charged with conspiracy, wire fraud, identity theft and illegal use of computer data. Each count carries a maximum sentence of three years in prison and a $10,000 or $25,000 fine.

Director George Keyworth quit Hewlett-Packard's board after the company disclosed the inquiry on Sept. 6, saying that he was the source of some of the leaks. Pretexting was used to gather records of hundreds of telephone calls by two current Hewlett- Packard employees, seven former or current directors or their families, and nine journalists or their family members.

In September, Dunn told a congressional committee that she had support from seven of the company's nine board members to conduct the inquiry and that she chose to work with investigators on the recommendation of director Robert Wayman.

Dunn told the committee that she received assurances through two phases of the inquiry, dubbed Kona 1 and Kona 2, that the methods used to obtain phone records were legal. She also denied claims from private investigator Ronald DeLia that she was aware the company was using pretexting to obtain phone records.

"This was not something I understood until early July of 2006 as a possible component of either investigation," Dunn said in her September testimony.

The day after Dunn surrendered to California authorities on Oct. 5, Nadler gave her permission to travel to Hawaii, where she has a vacation home. Since then, Dunn, of Orinda, Calif., has been receiving chemotherapy treatment for advanced ovarian cancer.

Kevin Hunsaker, a lawyer and former ethics director at Hewlett-Packard; DeLia; and two other private investigators, Matthew Depante and Bryan Wagner, previously pleaded not guilty to charges stemming from the inquiry.

At Wednesday's hearing, Nadler granted Dunn's request to skip some hearings in the case. He asked for a status report on Nov. 17. Deputy Attorney General Ralph Sevilla said the parties will convene then to report on the status of plea negotiations and set a preliminary hearing date.